Chapter 11: NISM-XV Exam Prep
📊
Day 53: NISM-XV Module 5 — Financial Statements Deep Dive
Numbers ke peeche ki kahani — exam ke liye must know!
2 min read
📖 Ramesh Tea Ltd Ka Annual Report
Ramesh Tea Ltd listed ho gayi — ab SEBI regulations ke under annual report publish karni padti hai. Report mein 200+ pages hain! CA bhai ne bola: "3 main cheezein hain — P&L, Balance Sheet, Cash Flow. In teeno ko samajh lo, poori company samajh aayegi!" 📊
Ramesh Tea Ltd listed ho gayi — ab SEBI regulations ke under annual report publish karni padti hai. Report mein 200+ pages hain! CA bhai ne bola: "3 main cheezein hain — P&L, Balance Sheet, Cash Flow. In teeno ko samajh lo, poori company samajh aayegi!" 📊
Profit & Loss Statement (Income Statement)
Revenue − Cost of Goods Sold = Gross Profit
Gross Profit − Operating Expenses = EBITDA
EBITDA − D&A − Interest = EBT
EBT − Tax = Net Profit (PAT)
Revenue/Sales → COGS → Gross → EBITDA → EBIT → EBT → Net Profit
Gross Profit − Operating Expenses = EBITDA
EBITDA − D&A − Interest = EBT
EBT − Tax = Net Profit (PAT)
Revenue/Sales → COGS → Gross → EBITDA → EBIT → EBT → Net Profit
Key P&L Ratios
| Ratio | Formula | Good Value |
|---|---|---|
| Gross Margin | Gross Profit / Revenue × 100 | 30%+ good |
| EBITDA Margin | EBITDA / Revenue × 100 | 15%+ good |
| Net Profit Margin | Net Profit / Revenue × 100 | 10%+ good |
| EPS | Net Profit / Shares Outstanding | Growing YoY |
Balance Sheet — Snapshot of Company's Health
ASSETS (Company ke paas kya hai)
- Fixed Assets: Land, building, machines
- Current Assets: Inventory, receivables, cash
- Intangibles: Brand value, patents
LIABILITIES (Company pe kitna hai)
- Long-term Debt: Bank loans, bonds
- Current Liabilities: Bills payable, short loans
- Shareholder's Equity: Your ownership stake
Cash Flow Statement — 3 Activities
| Activity | Kya Include Hota Hai | Positive = Good? |
|---|---|---|
| Operating CF (OCF) | Core business cash — sales, expenses | YES! Must be positive and growing |
| Investing CF | Buy/sell of assets, acquisitions | Negative usually OK (growing company invests) |
| Financing CF | Loans, dividends, equity issuance | Depends — debt reduction = good! |
Red Flags in Financial Statements
⚠️ Run From These Warning Signs!
🚩 Revenue growing but cash flow declining → Revenue may be fake/accrual based
🚩 Receivables growing faster than revenue → Customers not paying!
🚩 Promoter pledging shares → Cash crunch, forced selling risk
🚩 Frequent auditor changes → Red flag for governance
🚩 Large "other income" in profits → Main business struggling
🚩 Related party transactions unusually high → Money siphoning?
🚩 Revenue growing but cash flow declining → Revenue may be fake/accrual based
🚩 Receivables growing faster than revenue → Customers not paying!
🚩 Promoter pledging shares → Cash crunch, forced selling risk
🚩 Frequent auditor changes → Red flag for governance
🚩 Large "other income" in profits → Main business struggling
🚩 Related party transactions unusually high → Money siphoning?
🎯 Takeaway:
P&L = revenue se profit tak. Balance Sheet = assets = liabilities + equity. Cash Flow OCF positive hona zaroori. Screener.in pe free mein sab numbers dekhte hain! Red flags: receivables growing fast, promoter pledging, auditor changes. Kal — Valuation Methods + Derivatives Basics!
P&L = revenue se profit tak. Balance Sheet = assets = liabilities + equity. Cash Flow OCF positive hona zaroori. Screener.in pe free mein sab numbers dekhte hain! Red flags: receivables growing fast, promoter pledging, auditor changes. Kal — Valuation Methods + Derivatives Basics!